14.5 “Stigmas” on Property

Most state laws require that sellers disclose the fact that a property was occupied by a person who died in the property. Most state laws also require a Megan’s Law disclosure. Check your State laws for details. If a prospective buyer asks an agent whether there are any sex offenders living near the property and the agent does not have any reason to believe that a sex offender lives nearby, the appropriate answer should be “I’m not aware of any” rather than a definitive “no,” since the agent can never be certain that a sex offender does not live nearby. In such cases, the agent should inform the buyer that detailed information about registered sex offenders is available from the local sheriff’s department. The agent should also make the buyer aware of the existence of the statewide registry of sex offenders usually maintained by the state Department of Justice (access to which is available via the Internet - check your State for details). On the other hand, if the agent does have reason to believe that a sex offender might live nearby, the agent should avoid giving a definitive answer to the question without first checking the state Department of Justice sex offender registry or with the sheriff’s department to insure any information the agent has is accurate and up-to-date. The agent should understand that he/she is communicating information about a third person that could be detrimental to the reputation of the third person and that may stigmatize the property being sold. If the agent communicates inaccurate information, it opens up the possibility of liability to the third person or the owner of the stigmatized property. When asked the question, the agent should inform the prospective buyer of the existence of the sex offender registry and direct them to do their own research. The client should then check the registry to determine whether or not any registered sex offenders are listed as living nearby. If the agent is aware of the existence of the sex offender, the agent must disclose that information to the buyer (check your State for details as some States may not require this disclosure). The agent should document evidence of his/her findings (print the information from the state Department of Justice web site or get something in writing from the sheriff’s department), write the date and time the agent got the information on the written documentation itself, give the buyer a copy of the search results (whether or not those results indicate the presence of a sex offender in the neighborhood), and make a copy of whatever is given the buyer for the file.

Practical problems are inevitably "disclosed" by the neighbors; because of this, the policy of the Company is to discuss with the seller-client the inevitability of this disclosure and to recommend disclosure of such factors that may have an impact on a purchaser's decision to buy. Recent violent crimes or suicides are specific examples of such events. If, after this discussion, the seller-client instructs the company not to disclose these factors voluntarily, the agent should consult company management to determine whether the listing will be accepted.